The mechanism aims to achieve this by imposing a tax, the Carbon Border Tax (CBT), on imported goods that emit greenhouse gases. The EU border tax will be implemented gradually over a period of four years, commencing in October 2023. Another worry for textile and garment exporters is the potential impact on their supply chains. The carbon border tax could make it more costly for exporters to source products from these countries, further complicating supply chain dynamics. The EU's Carbon Border Adjustment Mechanism (CBAM) proposes taxing high-emissions imports, aiming to prevent carbon leakage, reduce emissions.

Source: Economic Times August 11, 2023 00:46 UTC